Founder of colony and member of one showing flag (7)
I believe the answer is:
pennant
'one showing flag' is the definition.
'pennant' can be an answer for 'flag' (pennant is a kind of flag). I'm not sure about the 'one showing' bit.
'founder of colony and member' is the wordplay.
'founder of colony' becomes 'Penn' (William Penn, founder of Pennsylvania).
'and' says to put letters next to each other.
'member' becomes 'ant' (I have seen 'Member of colony' mean 'ant' so perhaps 'member' could also mean 'ant').
'penn'+'ant'='PENNANT'
'of' is the link.
(Other definitions for pennant that I've seen before include "Long narrow flag" , "Banner" , "Standard" , "Tapering flag" , "Triangular flag" .)